ASSOCHAM urges PM to nudge CPSEs to spend Rs 5 lakh crore to revive growth

Lauding the public sector enterprises to be ready with a large investment kitty of Rs 5.02 lakh crore for the next financial year, ASSOCHAM urged Prime Minister Narendra Modi to convene a meeting of the CMDs of the CPSEs asking them to ensure that the entire planned expenditure for the fiscal 2016-17 is spent to give a leg-up to the economic growth. “In a subdued economic environment where the private sector is reeling under high debt, over-capacity and low margins, the Central Public Sector Enterprises (CPSEs) have to take a lead in reviving the business sentiment. Fortunately, with funds not being a problem for the state-owned firms, it is only a question of speedy implementation of the planned projects, be in the railways, highways, atomic energy, aviation, power or coal,” an ASSOCHAM Paper stated. Against the revised estimates of Rs 4.25 lakh crore for 2015-16, the Plan estimates for the CPSEs, including Indian Railways and the National Highway Authority of India have been pegged at Rs 5.02 lakh crore for 2016-16. “The best part is of this new investment, only Rs 95,330 crore would be contributed by the Central Budgetary Support whereas an overwhelming rest of it would be internal generation and the unutilized reserves with the government –owned companies,” it said. ASSOCHAM President Sunil Kanoria suggested that the Project Monitoring Group under the supervision of the Prime Minister’s Office can regularly ask for the feedback on the implementation of each of the projects given by the CPSEs given to their administrative ministries. “But at the beginning of the year, it would be a great start if the Prime Minister himself has a brain-storming with the CMDs of all the CPSEs. Some of the inter-ministerial issues can then be resolved on the spot. Things like fuel linkages, environmental clearances, can be resolved immediately where the cases are not pending in the court”. Of the total planned investment by the CPSEs, over Rs 3.50 lakh crore is earmarked in the railways, highways, power and oil sectors. “A special focus group of the ministers concerned in this area can be constituted who can meet along with the CMDs of the concerned CPSEs to monitor the project implementation,” the chamber said. It said the project implementation will also help the government realize its disinvestment target at a much better value realization since by the time the expanded capacity is commissioned, the capital market may also see a revival resulting in a significant appreciation in the CPSE shares. Besides, the project implementation in key infrastructure like roads, railways, power and gas and petroleum would, improved state of infrastructure.